Locally owned grocers benefit from Treasure Island closing

Meredith Counter restocks shelves at Open Produce, which opened after Treasure Island in 2008. She said demand is outpacing some suppliers’ capacity. (Photo by Aaron Gettinger)

By AARON GETTINGER
Staff Writer

If the checkout lines at Whole Foods are any indication, business has picked up significantly after Hyde Park’s other large grocery store, Treasure Island Foods, folded earlier this month. But the closing has produced a windfall for the neighborhood’s independent, produce-focused stores that are enjoying higher profits while hustling to keep up with demand.

“It’s kind of been an all-hands-on-deck kind of situation for all the staff,” said Meredith Coulter, the floor manager at Open Produce, 1635 E. 55th St. Keeping items in stock, particularly milk, eggs and bread, has lately been a struggle lately. Some of their small-batch and artisanal suppliers especially are having trouble adequately supplying the grocery.

Julie Damico, the manager of Hyde Park Produce, 1226 E. 53rd St., broadly estimated that business is up 25 or 30 percent and said that dry goods especially are selling at a much quicker pace. The store also is having some trouble keeping stocked, and the larger inventory has necessitated higher operations costs.

“It kind of hit us because Treasure Island closed before they said they would, so we weren’t as prepared as we would have liked to have been,” Damico said, comparing the current situation to the closing of the Hyde Park Co-op a decade ago. Still, “We’re catching up. We’re here, we’re open, we’re stocking as fast as we can, keeping produce as fresh as possible, and we hope everybody gives us a chance.”

She said three new employees, some former Treasure Island staffers, have joined the grocery’s 40-person payroll, which includes five members and three generations of the Damico family.

“There is an increase in profit margin, of course, but that’s not our focus,” Damico said. “We just want to keep the customers in Hyde Park, so that’s what we’re going to do.

“We want everyone to stay here, because that helps all of us.”

Steven Lucy, who owns Open Produce, said the storefront grocery has experienced a 20- to 25-percent sales bump. The majority of the business’ customers have come from a two- to three-block radius, though other customers drive there from elsewhere in Hyde Park or South Shore. In recent weeks, however, he has been seeing more and more new faces and additional visits from customers who had previously split their shopping between Treasure Island and other groceries.

Open Produce’s business, like many in Hyde Park, experiences a summertime slump before sales step up again when the U. of C. students come back. But Treasure Island’s closing fortuitously coincided with the beginning of fall this year, so the store “did a little extra” gearing up, with expanded staff hours and larger, more frequent wholesale deliveries.

While the Treasure Island closing has benefitted Open Produce in the short term, Lucy said he could not forecast what’s ahead long-term.

“We’ve had a big grocery store one block away for all of our existence, so it’s not like a new grocery store going in is going to change the game,” he said. “But if it has a different target demographic or average price point, then the effect is going to be hard to predict ahead of time.” He said the opening of Whole Foods, 5118 S. Lake Park Ave., coincided with a seven or eight percent hit to his store’s sales.

Hyde Park–Kenwood still lacks a stand-alone, non-up-market supermarket, at least until Jewel-Osco opens next year at 61st and Cottage Grove. Hyde Park Produce prides itself on carrying the high-end Boar’s Head line of delicatessen items and stocks hyper-seasonal produce; Lucy said that Open Produce’s fruits and vegetables are competitively priced, but the store does not carry cheaper versions of many items, instead carrying only organic milk or grass-fed ground beef.

“If we have what you want, it’s very competitively priced,” he said. “We’re a very small store, [and] we don’t carry everything.” Lucy noted that, with so much commerce moving online — Damico said that Hyde Park Produce’s internet orders have doubled since the closing — not every local store will go out of business, but some neighborhood dollars are still being spent online.

He referenced the recent economic history of local bookstores as a possible analogy for locally owned grocery stores. After big box booksellers like Borders and Barnes & Noble took a big bite out of local store’s profit margins, Amazon wholly disrupted the industry. Borders folded in 2011. Barnes & Noble lost over $24 million in fiscal year 2016, and its board of directors announced they were seeking a buyer earlier this month.

Meanwhile, local bookstores on the front line of presently fashionable localism with well-curated inventories that match customers’ interests and hosting talks and community events, have managed a widely reported comeback.

“I think the same thing may happen in food, where we move away from having 40,000-square foot everything-to-everyone supermarkets, and we have more specialty curated and convenience stores and online ordering,” Lucy said, adding that Open Produce is 700-square feet, Hyde Park Produce is around 10,000.

Coulter agreed about Open Produce’s niche: “We’re a small, local community space. We’re not a replacement for a 40,000-square foot grocery store. We’re doing the best to be here for our neighbors,” she said.

Hyde Parker John Hawkins, who has always done his shopping at Hyde Park Produce, said he keeps running into friends who live in East Hyde Park there.

“It’s been a pleasant surprise to see people who aren’t usually on this side of the neighborhood, but I’m not sure how they feel about it,” he said.

For her part, Damico urged Treasure Island customers to find management to request certain items at the store, saying Hyde Park Produce “is more than willing to look for stuff.”

And Gerald Davenport, walking down Cornell Avenue with Whole Foods bags with each hand, said shopping more at Open Produce out of convenience has carried a pleasant surprise. Whole Foods stocks the things he used to get at Treasure Island, but it’s a longer walk from his home.

“The one thing about Open Produce I really like is that you walk in, and it’s like you know the people. It feels like that old school, mom-and-pop shop but with that new age feel to it,” Davenport said, adding that he shops there for convenience and their vegan options. “It’s like you’re going in like you used to go in, when neighborhoods had their own grocery store. You get that same feel, but since they’re younger, it’s like a twist to it.

“I love it, man. It’s really like the bomb.”

a.gettinger@hpherald.com